WASHINGTON (Reuters) -- Iran has launched its first satellite in a step that has important symbolism but does not itself alter the strategic balance in the region, a U.S. national security official has said.

"The satellite technology they have deployed is probably not state of the art, but for the Iranians this is an important symbolic step forward," the official said, speaking on condition of anonymity.

Iran said earlier it had launched a domestically made satellite into orbit for the first time, a move which could further fuel worries by Israel and Western powers over its nuclear ambitions.

U.S. and British officials said the Iranian satellite program may use technology that could be used for ballistic missiles, and noted the United Nations has sought to discourage Iran's nuclear and missile programs.

Iran has long said its nuclear program is purely for civilian energy purposes.

"That's of grave concern to us," State Department spokesman Robert Wood told reporters about the satellite.

British Foreign Office Minister Bill Rammell said the launch "underlines and illustrates our serious concerns about Iran's intentions," adding it sent the "wrong signal to the international community."

Not A 'Game-Changer'

It is unclear what Iran intends to use the satellite for, and the United States is still trying to learn more about it, the U.S. security official said.

However, asked if the launch could have a strategic or tactical impact on the region, the official said, "This particular satellite launch does not appear to be a game-changer at all."

He said the satellite was in a low orbit and noted that some satellites last only a short time aloft.

"This one may fit into that category," he said.

Iranian state television showed footage of a rocket blasting off from a launchpad and lighting up the night sky as it streaked into space.

"With God's help and the desire for justice and peace, the official presence of the Islamic republic was registered in space," Ahmadinejad said.

Iranian Foreign Minister Manuchehr Mottaki told reporters during a visit to Ethiopia that the satellite had peaceful aims.

Germany, meanwhile, called the news "a worrying development."

The reported launch shows "once again the technical achievements that Iran is obviously capable of, and the threats," Foreign Minister Frank-Walter Steinmeier said during a visit to the United States as he prepared to meet with U.S. Secretary of State Hillary Clinton.

"We have been trying for years to stop Iran from developing its own nuclear program and its own nuclear weapons. So far we have not succeeded," said Steinmeier.

Therefore, it is even more urgent that "joint efforts with the new U.S. administration must be resumed...in order to divert Iran from any military uses of its nuclear program," he added.

World Powers To Meet

Senior officials from six world powers -- the United States, Russia, Britain, France, Germany, and China -- will meet on February 4 to discuss the nuclear row with Iran. It is their first meeting since U.S. President Barack Obama took office.

Obama has signaled that he will pursue direct talks with Tehran but has also warned Iran to expect more pressure if it does not meet the UN Security Council demand to halt atomic work the West fears has military aims.

Andrew Brookes of the International Institute for Strategic Studies (IISS) think tank in London said the news would prompt concern in Israel and elsewhere in the region.

"They will think that this civilian capability will soon be transformed to a military reconnaissance and intelligence gathering capability," he said.

Isaac Ben-Israel, a former head of the Israel Space Agency, told Reuters in Jerusalem: "If they managed to fire a satellite into space, it means they can also reach Western Europe."